Indonesia’s declining oil production has left it unable to meet its Opec quota, and it became a net importer of oil for several months of last year. That lead to some calls from parliamentary and industry groups for it to leave the group.

“A team has recommended Indonesia to stay as a full Opec membership,” Abdul Muin, the BPMIGAS official told Reuters.

“The recommendation to stay in Opec has been agreed by the government,” he added.

In April, a government panel suggested Indonesia could become an observer at Opec, which would remove its voting rights but also mean it would not have to pay the financial costs of membership.

Some parliamentarians and industry groups had wanted Indonesia to pull out of Opec, arguing that the country was not benefiting as a member due to its status as a net oil importer.

Muin said Indonesia still had potential oil reserves that could boost its production in the future.

“Indonesia has potential to boost oil production. However the government must work hard to attract investors to explore for oil,” he said.

Jakarta estimates crude production will fall 6 per cent in 2005, from last year’s 968,200bpd, but it aims to raise output by around 25 per cent to 1.18 million bpd by 2008.

Mines and Energy Minister Purnomo Yusgiantoro, formerly Opec president, has said Indonesia’s proven and probable oil reserves were 10.82 billion barrels.

Indonesia’s crude oil production slipped to 934,000bpd in June from 936,000bpd in May, due to the temporary shutdown of several wells. The country’s condensate output, exempted from Opec quotas, rose slightly to 124,000bpd in June, from 121,700bpd in May.

A mines and energy ministry official told Reuters yesterday the government could develop several fields, such as the Cepu bloc in Java’s offshore and the Jeruk field in East Java, next year.

“Both Cepu and Jeruk have the potential to boost Indonesia’s oil output,” said the official, who declined to be identified.

Indonesia has reached a tentative agreement with Exxon Mobil Corp. to tap reserves in the Cepu block that may exceed 500 million barrels of oil.

Indonesia also wants Australia’s Santos Limited to speed up oil and gas exploration in the Jeruk field, which is expected to produce 150,000bpd of oil. Santos operates and has a 50 per cent interest in the Jeruk field.